Microsoft Posts Huge Numbers in Latest Quarter

Posted on April 27, 2021 by Paul Thurrott in Microsoft with 25 Comments

Microsoft today announced that it earned a net income of $15.5 billion on revenues of $41.7 billion for the quarter ending March 31. Those are monster increases of 44 percent and 19 percent, respectively.

“Over a year into the pandemic, digital adoption curves aren’t slowing down,” Microsoft CEO Satya Nadella said. “They’re accelerating, and it’s just the beginning. We are building the cloud for the next decade, expanding our addressable market and innovating across every layer of the tech stack to help our customers be resilient and transform.”

Looking at Microsoft’s major business units, Intelligent Cloud was the biggest, with $15.1 billion in revenues, a YOY gain of 23 percent. Azure revenue exploded by 50 percent, while Server and cloud products revenues increased by 26 percent. Enterprise Mobility saw 38 percent growth in its user base to over 174 million seats.

Productivity and Business Processes was Microsoft’s second-biggest business in the quarter, with $13.6 billion in revenues, a gain of 15 percent. Office Commercial revenues jumped 14 percent, while Office Consumer revenues were up 5 percent; Microsoft 365 for consumers saw its subscriber base jump 27 percent to 50.2 million in the quarter.

Finally, More Personal Computing delivered a respectable $13 billion in revenues in the quarter, a gain of 19 percent. Windows revenues from PC makers grew 10 percent overall, with non-Pro revenue up 44 percent and Pro revenue down 2 percent. Xbox revenue overall grew 50 percent and Xbox content and services jumped 34 percent. Surface revenue was up 12 percent.

I’ll take a deeper dive in a special edition of Short Takes tomorrow.

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Comments (31)

31 responses to “Microsoft Posts Huge Numbers in Latest Quarter”

  1. Avatar

    MoopMeep

    they made a lot of profit.... they could help the third party developers and take less of a cut at the Xbox store..... they don’t need to take 30%. The only way you can sell games on Xbox is through Microsoft..... they are like a monopol.

    • Avatar

      Paul Thurrott

      There is where size and market matter. Xbox isn't one of two ways in which people can play videogames, and it's not even in the top three or four by market size. Likewise, the total installed base of Xbox consoles is under 100 million, probably half that, and that compares to several billion smartphones. So there's no market power for it to abuse.
      • Avatar

        MoopMeep

        In reply to paul-thurrott:

        But you have to factor that Xbox games are significantly more expensive than mobile phone apps. So Microsoft would get at least 15 dollars per game (and that’s only 25% of 60 dollars)and apple and google would probably at most get a dollar? Let’s also figure that mobile devices get upgrade every few years and an Xbox may take longer to be upgraded since new consoles only really come out every 7 years. It just sounds hypocritical... apple is bad charging 30% cuz some made up reason but other companies are ok cuz some other reason.

  2. Avatar

    John Craig

    Good for them. I just received an email from LinkedIn detailing some rather steep price increases for the professional services package.


    Now, I'm not saying that Microsoft are greedy bastards, who are giving Apple a run for thier money in terms of cash grabbing.


    All I'm saying is that Microsoft are greedy bastards, who are giving Apple a run for thier money in terms of cash grabbing.

    • Avatar

      Paul Thurrott

      Guys. Seriously. They're companies. They're literally designed to maximize profitability. They're not "bastards" or "cash grabbing," they're just businesses.
      • Avatar

        bsobotta

        In reply to paul-thurrott: Exactly. If you dont like the service go somewhere else. They employ people who also benefit from these companies. Capitalism makes the world go round.


      • Avatar

        locust_infested_orchard_inc.

        In reply to paul-thurrott:

        Indeed. Bravo. However Paul, you ought to caveat your comment of, and I quote you, "They're not "bastards" or "cash grabbing," they're just businesses.", that your comment whilst true for most businesses, most certainly excludes Google, Facebook, adult media companies, etc. The said companies are indeed "bastards".


        I'm sure it wouldn't have gone unnoticed how I categorised Google and Facebook with the pernicious, demeaning, and degenerate adult media entities.


        Just watching Mark Zuckerberg, Sundar Pichai and Jeff Bezos responding in the House Judiciary Subcommittee on Antitrust, Commercial, and Administrative Law in 2020, just shows how corrupt Facebook and Google.


        Mark Zuckerberg's finest moments was with his comment in response to the master tactician, Alexandria Ocasio-Cortez, when asked in October 2019 whether "lies and misinformation would be taken down from Facebook", to which Zuckerberg basically responded that such information shall remain on the defiled platform.


        Facebook wilfully engages in the bastardisation of the truth. Mark Zuckerberg's face says it all (many, many years ago, I believed that the facial expression he does was a sign of naïvety, but in the past couple of years, I released I badly misjudged - the facial expression is one of total disbelief of how Zuckerberg is managing to make billions from mis- and dis-information without being held to book).


  3. Avatar

    saint4eva

    Over 1.3 billion Windows 10

  4. Avatar

    Andi

    In reply to lvthunder:

    App Store has problems because it's the largest player of a two player market. Xbox and PS and Nintendo and PC Gaming are together dwarfed by mobile gaming. It's not just exclusivity it's also market size.


    The 2nd argument is the importance of the device. Steve Jobs introduced the iphone as a multi purpose device, a 3 in 1 if I remember correctly. It has grown to be the ULTIMATE PC, the most important device in our connected lives. The gaming console is a specialized niche entertainment instrument. They do not compare.

    • Avatar

      locust_infested_orchard_inc.

      In reply to Andi:

      You stated, and I quote you, "It [iPhone] has grown to be the ULTIMATE PC".


      What are you on ? You having a laugh. The file management on iØS is abysmal, and leaves a lot to be desired.


      File management done right is absolutely critical for any OS to be even considered to be hailed as "the ULTIMATE PC". That reason alone (though there are numerous others), for both the iNotch and iFad being taunted as being 'toys' by those who appreciate the shortcomings of Apple's devices.


  5. Avatar

    toukale

    In reply to lvthunder:

    Stop with your common sense, it won't fit the narrative. Microsoft is a trillion dollar company, sony, etc... multi-billion dollar companies the hypocrisy is shameful.

  6. Avatar

    matsan

    …and the market rewarded their stock with a 3% drop…

    • Avatar

      locust_infested_orchard_inc.

      In reply to matsan:

      Allow me to remind you that Apple's shares fell too upon releasing their financials.


      The reason that both $AAPL and $MSFT fell was to due profit taking by investors.

    • Avatar

      cavalier_eternal

      In reply to matsan:

      Markets are forward looking so the performance over the first three months of the year were already baked into the stock price. It’s dropping because while Microsoft did incredibly well the market had actually expected them to do better than they did. One can certainly say that expectation was unreasonable and I’d totally agree but it was there and it was in the price. So you are seeing the price come down to represent a more reasonable expectation.

      • Avatar

        locust_infested_orchard_inc.

        In reply to cavalier_eternal:

        Your assessment for $MSFT falling after its reporting is correct - but only in your first sentence.


        Your subsequent sentences are wrong, and actually contradict your first sentence.


        Microsoft earnings beat market expectations, and as you correctly state, the excellent earnings were already factored in the stock price over 2021.


        Investors saw this as an opportunity to do a spot of profit taking, on the back of great numbers from Microsoft.


        Remember, a falling stock price is not necessarily indicative of a poor performing company.


        Apple shares suffered the same fate, as its shares dipped upon earnings announcement. Once again, investors doing profit taking.

  7. Avatar

    Greg Green

    Why such an increase in net income? That seems quite out of step with the revenue increase.

  8. Avatar

    bsobotta

    I moved on from Microsoft services after the windows phone fiasco. Never again.


    That being said, good for them.

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